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Georgia FORUM | 12/25/2017
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In 2017, Workers Were Left Stranded While the Economy Boomed

By Nan Grogan Orrock
By
Dewey McClian

As we enter the new year, the economy is booming for big businesses and the stock market is at an all-time high. But many of us have friends, family, or neighbors who lost their jobs in 2017 through no fault of their own. Take the 52 workers who lost their jobs at Invista on December 12, two weeks before Christmas, when their carpet factory shut down in Athens, Georgia because their companion business relocated to Monterey, Mexico.

This is but one example of the thousands of Georgians who lost their jobs last year, as in many years before, due to circumstances beyond their control. The Great Recession that began in 2009 left in its wake a trail of hurt. Nationwide, lawmakers in state capitols responded to threatened budget deficits by slashing key social services, particularly programs intended to help the unemployed. Georgia was not immune to the trend.

In 2012, the Georgia legislature cut the number of weeks that a person could receive unemployment benefits to just 14 (with the possibility to rise to just 20 weeks tied to increased unemployment -- a trigger that has not been reached since). Fourteen weeks is well-below the long established national standard of 26. The maximum weekly benefit amount was capped at $330. The real value of unemployment assistance has dropped by 14 percent since 2009.

Those who backed these cuts will argue that they were the right thing to do. In times of fiscal austerity, some public programs need belt-tightening. And to be fair, there's some logic to this line of argument, even if the timing, severity and necessity of such cuts are up for debate.

However, if we accept that premise, we must also accept its flip side: that when budgets are in the black and the economy is growing, lawmakers ought to reverse the cuts to benefits that were supposedly only done out of "fiscal necessity." Lawmakers have failed to reverse the cuts to unemployment benefits in Georgia. In other states, such as nearby Kentucky and West Virginia, officials put into place automatic mechanisms for benefits to rise once their unemployment trust funds recovered. Not so here: benefits are still limited to 14 weeks and benefits remain capped at $330.

A recent report from The Century Foundation, a national public policy think tank, shows that Georgia has one of the least generous and most restrictive unemployment insurance programs of any state in the country, despite a dramatic turnaround in the health of our unemployment trust fund, which has gone from more than $761 million in debt to a $1.8 billion surplus.

Who has benefited from this recovery? Not workers, and definitely not the unemployed.

Currently, only 12 percent of jobless workers in Georgia receive an unemployment payment, the 4th lowest in the country. That's down from 33 percent in 2009.

What's more, business owners paid among the lowest unemployment tax rates of any state -- only 0.37 percent in unemployment taxes last year, down from the 0.58 percent rate they paid in 2012. That amounts to an average savings of $179.56 per employee, according to the Century Foundation analysis.

In short, employers are reaping the benefits from a recovered unemployment trust fund and steadily-expanding economy. For workers, on the other hand, it still feels like the aftermath of the recession.

As lawmakers, we have a duty to help the most vulnerable in our state. That means people who are out of work and are diligently looking for jobs; it doesn't mean big business, many of which are experiencing record profits.

The new year offers an opportunity to be better neighbors to Georgians who have fallen on hard times. We must take a renewed look at unemployment insurance, and, at a minimum, restore benefits to their pre-recession levels. The money is there to do so. With a big surplus, Georgia is now one of 29 states that meet or exceed federal standards for being prepared for the next recession.

Right now, we can and must offer stronger support for the unemployed. The Georgia General Assembly should act to restore unemployment benefits to strengthen the economy and guard against the next downturn.

Orrock is a member of the Georgia State Senate representing District 36 (Atlanta-Fulton County). McClain is a member of the Georgia House of Representatives representing District 100 (Lawrenceville - Gwinnett County) and is the President of the Atlanta North Georgia Labor Council AFL-CIO. They serve as Co-Chairs of the Georgia Working Families Legislative Caucus.

 
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